Selling a Family Business
Succession plan in family businesses may not be as prevalent as it might seem as only about 28% of these businesses have such plan in place. The rest might be considering selling their businesses to someone outside their family. When it ultimately comes to selling the business, here are a few points to consider:
- If maintaining jobs of family members within the company is important, consider lowering the price
- Prepare family members staying in the business for answering to new management, an outside board of directors and/or outside investors
- Have all family members involved in either management or investing into the business agree on selling it. It is also important they similarly agree with the price and terms of the sale.
- Confidentiality in the sale of a family business is a must
- Family members should appoint a member who can speak for everyone. More people in involved in decision-making usually only causes delays and causes many deals to fall apart
Experts in family-owned businesses generally recommend having a professional intermediary facilitate the sale for the family. Not only are they aware of the critical time element and thus are able to speed up the process, but they can also locate other experienced advisers if necessary.